The long-term goal of this project is to elucidate molecular mechanisms that regulate cell-cell communication during development. We are interested in two related key questions in cellular communication: 1) how are tissues patterned and correctly connected by long-range signals, and 2) how are cells structures and functions coordinated at short-range with those of their neighbors. We study these processes by focusing on early developmental patterning, and on development of a specialized cell-cell interaction zone, the neuromuscular junction (NMJ). Bone morphogenetic proteins (BMPs) accomplish diverse patterning control through the regulation of long-range and short-range signaling by secreted BMP binding proteins such as Short gastrulation (Sog)/Chordin and Crossveinless-2 (Cv-2). We have recently revealed how evolutionary changes in proteolytic control of Sog have influenced morphogen gradient formation and function in the Drosophila embryo. More specifically, long-range BMP diffusion requires BMP dependence of Sog destruction, which in turn allows for robust, rapid developmental patterning by BMPs. BMPs are also utilized to modulate growth, development and homeostasis at the Drosophila NMJ, a glutamatergic synapse similar in structure and function to vertebrate central synapses. In flies each NMJ is unique and identifiable, synapses are large and accessible for electrophysiological and optical analysis, making the Drosophila NMJ a favorite genetic system to study synapse development. At the Drosophila NMJ, Glass bottom boat (Gbb), a BMP-type ligand secreted by the muscle, provides a retrograde signal that promotes synaptic growth and confers synaptic homeostasis. Gbb signals by binding to a presynaptic hetero-tetrameric complex of type-I and type-II receptors. Activated receptors recruit and phosphorylate the BMP pathway effector, Mad. Phosphorylated Mad (pMad) accumulates at two locations: in the motor neuron nuclei (nuclear pMad) and at the NMJ synapses (synaptic pMad). Nuclear pMad, in conjunction with transcription factors, modulates expression of target genes and sculpts synaptic growth; a role for synaptic pMad remains to be determined. We discovered that pMad signals are selectively lost at NMJ synapses with reduced postsynaptic sensitivities. Synaptic pMad appears to function as a local sensor for NMJ synapse activity and has the potential to coordinate synapse activity status with an instructive BMP retrograde signal required for synapse growth, stability and homeostasis. The molecular mechanisms underlying the ability of synaptic pMad to function as an acute sensor for postsynaptic activity are currently investigated.